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List Now…Changes Are Coming

THE VIEW FROM OAK PARK

The Official Krisztina Blogsite

The question I’m most asked right now in the depths of winter is: Should I list my home now or wait until spring? I say NOW’S THE TIME!! Inventory is currently low, therefore following the Economics 101 rules of Supply and Demand, prices are somewhat higher. The forecast for Spring is that more homes will be on the market, driving prices downward. If you are ready, list now and look for a longer closing. That way, you can begin your new home search in March. Overall, we expect resales to slide in 2011 given our still weak economy, slow job growth, poor consumer confidence and the presumed impending interest rate hike mid-year.

Add to that the Government’s move to tighten mortgage eligibility, thus eliminating a number of potential Buyers’ ability to secure a mortgage or forcing some Buyers to borrow less in order to keep their payments affordable. Citing valid concerns that Canadians are taking on too much debt, the government would no longer insure mortgages higher than 30 years. You can take a look at the chart I’ve included from BMO Capital Markets and the Toronto Star which outlines the difference in payments in a 30 vs. 35 year mortgage. As well, they are tightening the rules for existing homeowners who want to refinance their homes by lowering the maximum amount Canadians can borrow to 85% of the property’s value and will no longer insure personal credit lines secured by homes. Ultimately these moves will impact home sales and home prices. As well, there is a move afoot to include 100% of Condo Fees in eligibility for a Condo mortgage (vs. 50% previously). For Condo Buyers, this will impact the amount they can borrow for a Condo purchase. For First Time Buyers, CMHC is tightening the process of qualifying for the 5% Down privilege. They are going to make the approval much harder and will look very closely at Credit Ratings. To qualify, First-Timers must have immaculate credit and I feel this will also eliminate a number of potential Buyers from the market.

I do not, however, expect any of this to impact my personal volume of business. With low interest rates, mortgage carrying costs are still very affordable. I continue to be busy in the Oakville real estate market and Jennifer Patterson, my newest Team Member, is busy serving the Toronto market (as well as backing me up here in Oakville). Although some of you have already met Jennifer, I will be introducing her via a YouTube video in the near future so that you may all see what I saw – the great qualities she brings to the table and the great fit she is to my Team. And to underscore my confidence in business for 2011, I will be further expanding my team to serve you better.